Former Salander Director Convicted of Scheme to Defraud

On April 6, a New York State Supreme Court jury found former Salander-O’Reilly Galleries director Leigh Morse, 55, guilty of “participation in a large-scale art fraud that victimized the estates of four artists.”

NEW YORK—On April 6, a New York State Supreme Court jury found former Salander-O’Reilly Galleries director Leigh Morse, 55, guilty of “participation in a large-scale art fraud that victimized the estates of four artists.” According to a written release from the Manhattan district attorney, Cyrus Vance, Morse “fraudulently sold more than 80 artworks from four estates without notifying them.”

Lawrence Salander, former owner of the now-shuttered gallery on the Upper East Side, is currently serving a six-to-eighteen year sentence in state prison, having pled guilty in March 2010 to 29 counts of grand larceny and one count of scheming to defraud. His gallery business collapsed in late 2007 amid a flood of lawsuits, bankruptcy proceedings and a shutdown by the Manhattan district attorney.

Salander admitted to defrauding consignors, investors and high-profile clients, including former tennis pro John McEnroe and actor Robert de Niro, out of an estimated $120 million. One of the charges against Morse involved the sale of two paintings by de Niro’s father, a well-regarded Abstract Expressionist painter whose estate Salander had represented for decades. Following the sale of the works, $77,000 was wired directly to Morse’s personal bank account, according to legal documents. De Niro’s testimony in court regarding Morse’s actions drew even more attention to the high-profile art-world scandal.

With respect to the de Niro paintings sale, Morse’s defense attorney Andrew Lankler argued that Morse believed these transfers were appropriate as they were made to satisfy commissions she was owed, and the jury agreed. Morse was acquitted of the charge of grand larceny.

According to the district attorney’s statement, Morse, “together with her accomplice, convicted art gallery owner Lawrence Salander, systematically looted the estates of her clients over a period of many years.”

The statement continued: “As director and on many occasions as the primary contact for the estates, Morse was well aware of the true status of many of the works about which the estates had inquired. This information included the sale or payment status on numerous works she personally sold months and even years prior, and for which she earned a commission. However, rather than communicate the truthful information to the respective estates, Morse intentionally misled them or failed to disclose the true status of their works. By not informing the estates that their works were sold, in one case almost a decade earlier, Morse prevented the estates from demanding payment for those sales or having the ability to make an informed decision about removing their remaining works from the gallery.”

Morse, who is scheduled to be sentenced on June 3, faces a minimum sentence of “conditional discharge,” whereby certain conditions are placed on the defendant, such as no further commission of crime, community service, payment of a fine or restitution. The maximum sentence is 1 1⁄3 years to 4 years in prison, her attorney Lankler told ARTnewsletter in an email. However, he added, “we do not anticipate a prison sentence.”

Lankler said: “While we are disappointed that Ms. Morse was found guilty of Scheme to Defraud, we would note that not one single witness ever testified that Ms. Morse sold art with the intent that the owners and/or consignors of that art would not be paid; indeed, the opposite is true. Moreover, the evidence in the trial also demonstrated efforts made by Ms. Morse to help owners have their art returned to them both before and after she left the gallery in August of 2007.”

Lankler added: “We are, of course, very grateful that the jury recognized that Ms. Morse did not engage in any thefts.”